Dow component JPMorgan Chase & Co. (JPM: sentiment, chart, options) was slapped with a downgrade to "underperform" this morning. Merrill Lynch slashed its rating from "neutral," citing near-term pressure on earnings. "We do not believe the Street has rationalized the true impact of expected economic woes on consumer credit, and particularly what that means for JPM earnings," said analyst Guy Moszkowski.

The analyst offered up his own estimate for JPM's fourth-quarter results; he now expects a loss of 11 cents per share, compared to his previous estimate for a profit of 25 cents per share.

JPMorgan shares are down nearly 7% at midday, more than reversing Friday's 3.3% gain. Last week, CEO Jamie Dimon warned that the bank's fourth quarter was looking "terrible" so far.